IC-NRLF 


GIFT   OF 
r*.H .L.Leupp 


MOBILIZATION  OF  INDUSTRIES  AND  UTILIZATION  OF 

THE  COMMERCIAL  AND  INDUSTRIAL  RESOURCES 

OF  THE  COUNTRY  FOR  WAR  PURPOSES 

IN  EMERGENCY 


PREPARED  BY  THE  WAR  COLLEGE  DIVISION,  GENERAL  STAFF  CORPS 

AS    A    SUPPLEMENT   TO    THE    STATEMENT    OF   A    PROPER    MILITARY 

POLICY  FOR  THE  UNITED  STATES 


WCD  8121-45 


ARMY  WAR  COLLEGE  :  WASHINGTON 

NOVEMBER,   1915 


517 


WASHINGTON 

GOVERNMENT  FEINTING  OFFICE 
1916 


»*  •  • 


WAR  DEPARTMENT, 

Document  No.  517. 

Office  of  the  Chief  of  Staff. 


V 

0 


SYNOPSIS 


Page. 

1.  Action  taken  by  other  countries 5 

2.  Necessity  for  action  in  the  United  States 6 

3.  Reports  from  the  general  staff  and  bureau  chiefs 6 

4.  Suggested  plans  from  other  sources 9 

5.  Recommendations  for  necessary  legislation 11 

30669*-No.  517 16  (3) 


667374 


MOBILIZATION  OF  INDUSTRIES  AND  UTILIZATION  OF 
THE  COMMERCIAL  AND  INDUSTRIAL  RESOURCES  OF 
THE  COUNTRY  FOR  WAR  PURPOSES  IN  EMERGENCY. 


1.   ACTION  TAKEN  BY  OTHER  COUNTRIES. 

The  mobilization  of  industries  has  been  undertaken  in  all  the  coun- 
tries that  are  at  present  at  war.  Reports  from  abroad  are  incomplete 
on  this  subject,  but  all  indicate  that  a  more  or  less  perfected  scheme 
has  been  adopted  in  all  countries.  An  enabling  act  is  the  first 
requisite,  and  the  details  of  its  exercise  vary  in  each  of  the  countries. 

In  Russia  a  committee  was  appointed  to  supervise  the  manufac- 
ture and  supply  of  war  munitions,  making  use  of  all  civilian  plants. 
The  president  of  the  Duma,  an  ex-minister  of  commerce,  and  two 
prominent  army  officials  were  also  made  members  of  this  committee 
for  purposes  of  consultation  in  regard  to  technical  matters. 

In  England  the  Government  control  of  all  engineering  industries 
was  taken  over  under  an  act  called  the  "  mobilization  of  industry  act." 
This  was  passed  with  ease  and  rapidity  by  the  House  of  Commons. 
The  original  act  provided  for  the  taking  over  and  control  of  any 
works  where  war  munitions  were  being  made.  Later,  the  act  was 
amended  to  include  all  industries  that  could  be  utilized  if  modified. 
Power  to  cancel  existing  contracts  with  private  parties  was  also  made 
a  part  of  the  law. 

In  France  an  act  called  the  "  Dalbiez  Act "  was  passed,  under 
which  all  commercial  manufacturing  plants,  used  in  whole  or  in 
part  for  making  supplies  for  the  Army,  were  taken  over  by  the  Gov- 
ernment. Originally  all  skilled  workmen,  heads  of  departments,  and 
superintendents  were  excused  from  military  service.  It  was  found 
that  this  exemption  was  abused  and  a  large  number  of  men  suitable 
for  military  services,  but  not  absolutely  necessary  in  the  manufac- 
turing plants,  avoided  military  service.  The  civilian  superintendents 
of  the  works  taken  over  report  that  they  have  no  trouble  with  strikes 
or  labor  disorders  while  under  military  control,  for  as  soon  as  a 
workman  by  his  act  shows  that  he  is  not  necessary  in  the  plant  itself 
he  is  available  to  go  to  military  service  in  the  field,  which  acts  as  a 
deterrent  against  strikes. 

617  (5) 


6 

In  Italy  all  the  larger  automobile  factories  or  garages  have  been 
taken  over  for  the  manufacture  of  war  munitions. 

Similar  provisions  have  been  made  in  Austria  and  Germany.  In 
most  of  these  countries  this  mobilization  of  industries  is  carried 
down  to  the  smaller  industries  in  minute  detail.  For  example,  in 
both.  Austria  ^iro:  France  all  the  horses  and  wagons  suitable  for 
military  service  are  listed,  and  the  record  is  kept  by  area  officers  so 
that  the  Government  at  any  time  can  ascertain  how  many  horses  and 
wagons  are  available,  and  their  condition,  in  any  stated  district. 
There  is  a  price  fixed  by  law  at  which  owners  shall  be  reimbursed 
for  their  teams  and  wagons  used  for  military  purposes. 

2.  NECESSITY    FOR   ACTION    IN   THE    UNITED    STATES. 

The  subject  of  the  mobilization  of  the  industries  in  this  country 
has  been  discussed,  but  no  definite  action  has  as  yet  been  recom- 
mended or  undertaken.  The  desirability  of  taking  steps  to  acquaint 
our  larger  manufacturing  establishments  with  the  necessary  details 
to  enable  them  to  fill  a  Government  contract  has  received  careful 
consideration.  A  number  of  representatives  of  the  larger  manufac- 
turing establishments  have  expressed  their  willingness  to  undertake 
this  preparation.  It  has  been  proposed  that  the  Chief  of  Ordnance 
send  the  necessary  plans  and  specifications  for  types  of  guns  and 
ammunition  to  manufacturing  establishments  presumably  capable 
of  making  these  munitions,  each  company  to  be  awarded  a  small 
contract  and  given  the  necessary  Government  inspectors  and  super- 
intendents to  advise  and  supervise,  so  that  when  this  small  contract 
was  filled  the  templets,  plans,  and  dies  could  be  retained  at  the  fac- 
tory, and  from  the  experience  gained  in  filling  this  small  contract 
they  would  be  able,  without  delay,  to  undertake  larger  contracts  in 
case  of  necessity.  It  was  found  that  this  plan  was  not  in  accordance 
with  the  law  or  with  the  desire  of  Congress.  This  year,  however, 
legislation  permitting  this  method  of  procedure  for  the  preparation 
of  large  manufacturing  plants  for  Government  use  has  been 
recommended. 

3.  REPORTS  FROM  THE    GENERAL  STAFF  AND  BUREAU 

CHIEFS. 

On  September  13,  1915,  in  a  memorandum  for  the  Chief  of  Staff 
by  the  Chief  of  the  War  College  Division,  on  the  subject  of  a  pro- 
posed plan  to  enable  private  manufacturers  to  promptly  furnish  war 
material  in  case  of  emergency,  the  question  is  considered  in  detail 
and  heads  of  bureaus  were  called  on  for  recommendation  as  to  the 
additional  legislation  necessary  to  enable  their  department  to  pur- 
chase war  material  from  private  manufacturers. 

517 


SEPTEMBER  13,  1915. 

MEMORANDUM  FOR  THE  CHIEF  OF  STAFF. 

Subject:  Proposed  plan  to  enable  private  manufacturers  to  promptly  furnish 
war  material  in  case  of  emergency. 

1.  Herewith  is  a  memorandum  from  the  Acting  Chief  of  Ordnance,  accom- 
panying memorandum  for  the  Chief  of  Staff  (WCD  8121-19),  August  17,  1915. 

2.  The  Acting  Chief  of  Ordnance  enumerates  obstacles  to  be  encountered  as 
follows : 

"  The  furnishing  of  drawings  and  specifications  *  *  *  would  involve 
considerable  expense,  and  it  is  a  question  whether  the  present  wording  of  the 
appropriations  would  permit  of  such  expenditures.  *  *  *  the  furnishing  of 
such  information  at  this  time  would  be  contrary  to  the  instructions  of  the  Sec- 
retary of  War,  as  quoted  in  paragraph  3  of  the  memorandum  of  the  Chief  of 
the  War  College  Division  *  *  *. 

"  *  *  *  the  number  of  such  manufacturers  is  large,  and  that  the  ability 
of  the  department  to  give  orders  for  material  is  limited  to  the  appropriations 
available,  which,  at  present,  are  limited  by  congressional  action  to  but  a  small 
part  of  the  appropriations  for  the  various  purposes  *  *  *. 

"  *  *  *  such  orders  could  be  but  limited,  and  unless  occasional  orders 
could  be  placed  with  each  of  the  firms  selected  it  is  anticipated  that  they 
would  soon  lose  interest  *  *  *. 

«  *  *  *  under  existing  laws  when  purchases  are  to  be  made  orders  must 
be  placed  with  the  lowest  responsible  bidder  for  the  best  and  most  suitable 
article.  As  long  as  this  restriction  is  imposed  the  majority  of  the  orders 
would  be  secured  by  a  limited  number  of  manufacturers  who  are  in  a  position 
to  underbid  those  with  less  satisfactory  equipment  and  higher  operating  ex- 
penses *  *  *." 

3.  The  Acting  Chief  of  Ordnance  recommends  that  now,  if  the  instructions  of 
the  Secretary  of  War  are  modified,  if  not,  then  after  the  close  of  the  present 
war — 

"  *  *  *  a  carfully  selected  list  be  prepared  of  private  manufacturers  for 
each  class  of  ordnance  material,  and  that  drawings  and  specifications  of  the 
material  they  could  manufacture  be  furnished  them  in  order  that  in  renewing 
or  increasing  their  plant  it  may  be  further  adapted  to  the  manufacture  of  the 
particular  ordnance  material  in  question,  and  that  the  management  may  make  a 
study  of  the  manufacture  of  such  material  *  *  *." 

4.  The  War  College  Division  is  aware  of  the  obstacles  due  to  limited  appro- 
priations, restrictive  legislation,  instructions  of  the  Secretary  of  War,  etc. 

Also,  that  some  concerns  will  lose  interest  if  they  can  not  see  a  profit,  but 
believes — and  the  belief  is  largely  based  on  the  character  of  the  many  letters 
received  by  the  Secretary  of  War  during  the  past  year  from  railroad  officials, 
corporations,  engineer  societies,  manufacturers,  etc. — that  a  large  percentage  of 
manufacturers  would  willingly  cooperate,  through  patriotic  motives,  in  prepar- 
ing to  manufacture  supplies  required  in  war. 

5.  The  War  College  Division  concurs  in  the  method  of  procedure  recom- 
mended by  the  Acting  Chief  of  Ordnance,  and  further  recommends  that  in  the 
next  estimate  of  funds  a  suitable  sum  be  included  for  the  specific  purpose  of 
covering  necessary  expenses  for  furnishing  private  manufacturers  with  draw- 
ings and  specifications  of  the  material  they  could  manufacture  and  for  trial 
orders  to  demonstrate  their  capacity  and  the  suitability  of  their  equipment. 

M.  M.  MACOMB, 

Brigadier  General,  Chief  of  War  College  Division. 
517 


8 

As  a  result  of  the  above  memorandum  the  following  was  received 
at  the  War  College  Division  October  1, 1915 : 

DRAFT  OF  MEMORANDUM.  WCD  8121-27 

From :  The  Chief  of  Staff. 

To :  The  Chief  of  the  War  College  Division. 

Referring  to  the  accompanying  proposed  memorandum  relative  to  the  en- 
couragement of  reputable  and  competent  private  manufacturing  establishments 
to  equip  themselves  for  furnishing  war  material  of  the  class  needed  by  the 
Government,  and  to  maintain  themselves  in  condition  for  manufacturing  such 
material,  the  Secretary  of  War  has  directed  that  the  chiefs  of  the  staff  de- 
partments give  this  subject  consideration  and  submit,  in  connection  with  their 
annual  estimates,  such  proposed  legislation  as  may  be  necessary  to  free  them 
from  the  statutory  restrictions  which  now  prevent  the  inauguration  of  such  a 
policy.  In  so  far  as  the  restrictions  imposed  by  the  War  Department,  with 
reference  to  the  neutrality  of  the  United  States  or  other  circumstances,  are 
concerned,  the  chiefs  of  the  staff  departments  are  also  instructed  to  bring  to  the 
attention  of  the  Secretary  of  War  any  case  in  which  it  appears  to  be  appro- 
priate to  modify  the  restrictions  thus  imposed. 

(Copies  to  the  chiefs  of  the  staff  departments  for  their  information  and 
guidance. ) 

Approved : 

LJNDLET  M.  GARRISON, 

Secretary  of  War. 

Approval  recommended: 

H.  L.  SCOTT, 
Major  General,  Chief  of  Staff. 

Received  Office  Chief  of  Staff  September  30,  1915. 

Received  War  College  Division  October  1,  1915. 

The  following  is  a  brief  of  the  reports  made  by  bureau  chiefs : 

The  Chief  of  Ordnance  reported  that  a  draft  of  legislation  au- 
thorizing such  purchase  in  time  of  emergency  had  been  incorporated 
in  the  estimate  submitted  by  the  Ordnance  Department  for  the  en- 
suing fiscal  year. 

The  Quartermaster  General  reported  that  Revised  Statutes  No. 
3709  in  the  act  of  July  5,  1884,  give  ample  authority  for  the  pur- 
chase without  advertising  when  immediate  delivery  is  required  by 
the  public  exigency,  stating  further  that  this  would  seem  to  permit 
any  purchase  at  any  time  in  the  event  of  war. 

The  Chief  of  Engineers  quoted  that  he  had  included  the  following 
provision  in  the  estimates  of  appropriations  in  the  Army  appropria- 
tion bill  now  being  prepared  in  his  office : 

The  Secretary  of  War  may,  when  in  his  opinion  to  the  manifest  interest  of 
the  United  States,  authorize  the  procurement  of  engineer  equipment  required 
for  military  purposes  from  such  private  establishments  as  he  may  select. 

The  Surgeon  General  reported  that  in  his  opinion  the  only  way  to 
establish  the  war  reserve  is  to  procure  beforehand  a  reasonable  re- 
serve in  actual  possession  of  all  articles  not  perishable  which  are  not 

517 


ordinarily  to  be  found  in  the  markets,  but  which  must  be  made  to 
conform  to  especial  desire. 

4.  SUGGESTED  PLANS  FROM  OTHER  SOURCES. 

In  addition  to  the  reports  from  bureau  chiefs  just  quoted,  sug- 
gestions have  been  received  from  various  outside  sources  as  to  meth- 
ods of  organizing  various  commercial  industries.  Most  of  these 
plans  suggest  methods  more  or  less  elaborate,  but  all  are  based  on 
voluntary  response  of  individuals  and  service  of  industries,  and  for 
this  reason  it  is  believed  they  will  prove  unsatisfactory  and  inefficient. 

Under  the  present  limited  or  lack  of  control  of  the  United  States 
Government  over  manufacturing  industries  no  real  progress  can  be 
assured  without  further  legislation.  Many  prominent  industries 
indicate  their  willingness  to  act  with  the  Government  through  pa- 
triotic motives,  but  unless  there  is  some  actual  obligation  existing 
between  the  two  little  can  be  accomplished. 

An  excellent  example  of  a  plan  of  this  nature  is  one  proposed, 
and  copyrighted,  by  Mr.  Martin  J.  Gillen,  of  the  Mitchell  Wagon 
Co.,  of  Racine,  Wis.,  who  states: 

The  original  plan  was  sent  to  all  the  executive  officers  of  this  Government, 
United  States  Senators  and  Congressmen,  the  Governors  of  the  several  States, 
the  presidents  of  universities,  the  Army  and  Navy  officers  ranking  from 
captains  upward,  the  retired  officers  of  the  Army  and  Navy,  the  officers  of 
the  Grand  Army  of  the  Republic,  400  of  the  principal  newspapers  and  periodi- 
cals of  the  land,  and  about  200  business  men.  Out  of  600  replies  only  3  con- 
sidered the  idea  of  no  value,  the  remainder  considered  the  plan  meritorious, 
and  some  offered  most  valuable  suggestions  which  have  been  incorporated. 
The  plan  revised  is  now  submitted  anew. 

This  plan  was  referred  to  the  War  College  Division  of  the  General 
Staff  for  report  and  based  on  a  favorable  recommendation  for  con- 
siderations made  by  the  Chief  of  Engineers  in  a  letter  dated  Septem- 
ber 16,  1915  (AGO  2322644-A),  reports  were  called  for  from  the 
Quartermaster  General,  the  Surgeon  General,  the  Chief  of  Ordnance, 
the  Chief  of  Engineers,  and  the  Chief  Signal  Officer. 

The  reports  in  general  make  favorable  comment  on  certain  features 
of  the  plan,  and  in  some  cases  suggest  minor  objections,  but  all  agree 
that  additional  legislation  must  be  obtained  to  put  such  a  plan 
into  effect. 

Mr.  Gillen  states  in  closing : 

This  plan  is  submitted  in  the  hope  that  it  will  draw  forth  from  the  executive 
officers  of  this  Government,  the  United  States  Senators,  the  Congressmen,  the 
executive  officers  of  the  several  States  of  this  Union,  our  Army  and  Navy 
officers,  our  editors,  business  men,  farmers,  and  working  men,  such  publicity 
and  welcome  criticisms  to  the  writer  to  the  end  that  a  final  legal  plan  may  be 
adopted  by  this  Government  which  will  be  so  broadly  elastic  and  comprehensive 
as  to  embrace  any  and  all  conditions  that  may  arise  in  preparing  this  Nation 
that  right  and  justice  may  be  enforced  if  needed. 
517 


10 

Instances  are  daily  occurring  where  efforts  and  plans  of  the  Gov- 
ernment in  experimentation  and  development  work  are  being  ham- 
pered, delayed,  and  even  thwarted  from  lack  of  authority  to  demand 
reasonable  and  certain  response  on  the  part  of  commercial  industries. 

A  comparatively  unimportant  example  pertaining  to  experimental 
work  in  the  development  of  a  field  searchlight  outfit  is  quoted  below 
simply  as  an  illustration  of  delay  and  obstructions  frequently  being 
met  even  where  important  interests  of  the  General  Government  are 
concerned.  Similar  action  can  be  expected  from  any  industry  under 
our  present  laws : 

On  June  14,  1915,  the  Engineer  depot  wrote  to  the  *  *  *  company, 
stating  that  the  depot  desired  to  purchase  a  standard  *  *  *  truck  with 
generator  mounted  on  the  truck  body  and  driven  by  silent  chain  from 
transmission  shaft.  Asked  if  the  *  *  *  company  could  supply  such  a 
truck  and,  if  so,  to  quote  on  one.  Between  this  date  and  June  28,  1915,  cor- 
respondence was  carried  on  between  the  depot  and  the  *  *  *  company  and 
although  the  latter  company  appeared  reluctant  at  first  to  take  up  the  proposi- 
tion, on  June  28,  1915,  they  replied,  stating  they  would  take  up  the  proposition 
and  would  have  their  chief  engineer  investigate  the  electrical  installation.  On 
July  23,  1915,  the  *  *  *  company  quoted  a  price  on  the  outfit  as  requested 
by  the  Engineer  depot. 

On  July  28,  1915,  the  Engineer  Depot  wrote  to  the  Chief  of  Engineers, 
United  States  Army,  requesting  allotment  to  purchase  this  truck.  The  letter 
was  returned  asking  for  details  of  installation  and  on  August  21,  1915,  the 
Engineer  Depot  returned  the  letter  again  by  indorsement,  giving  the  details 
requested.  No  reply  having  been  received  by  the  Engineer  Depot  to  this 
letter,  the  entire  matter  was  dropped  at  that  time. 

October  16,  1915,  commanding  officer,  First  Battalion  of  Engineers,  received 
a  letter  from  the  Chief  of  Engineers  advising  that  the  allotment  requested 
by  the  Engineer  Depot  in  letter  of  July  28,  1915,  for  the  purchase  of  *  *  * 
truck  had  been  made  and  directing  that  design  and  purchase  be  accomplished 
by  officers  of  the  battalion  with  the  assistance  of  the  Engineer  Depot. 

October  28,  1915.  Letter  from  one  of  the  officers  of  the  Engineer  Battalion 
to  the  *  *  *  company,  stating  that  he  had  been  detailed  to  attend  to 
the  purchase  of  the  above  truck  and  explaining  that  the  Engineer  Depot  had 
dropped  the  matter  in  July,  because  of  the  failure  in  obtaining  the  allotment 
at  that  time.  Asked  the  *  *  *  company  if  they  would  still  take  up  the 
proposition. 

November  2,  1915.  Reply  from  the  *  *  *  company  stating  that  the  re- 
quirements were  rather  severe  and  they  would  rather  not  take  the  order ;  that 
they  would  be  glad  to  build  the  special  car,  but  at  that  time  they  were  crowded 
with  work  working  day  and  night,  and  would  not  be  able  to  get  the  job  out  in 
short  notice.  They  were  very  sorry  that  they  could  not  undertake  the  proposi- 
tion at  that  time. 

November  4,  1915.  Engineer  depot  received  by  indorsement  their  letter  in- 
dorsed to  the  office,  Chief  of  Engineers,  August  21,  1915,  stating  that  the 
allotment  therein  requested  had  been  granted. 

November   5,    1915.  Letter   from    officer   of   the   engineer   battalion   to   the 
*    *    *    company,  explaining  that  the  truck  in  question  was  a  step  in  the 
development  of  field  searchlights  for  the  mobile  Army  and  of  particular  im- 
portance at  that  time  and  urging  them  to  reconsider  their  decision. 
617 


11 

November  22,  1915.  Letter  from  the  chief  engineer,  *  *  *  company,  say- 
ing he  had  been  trying  to  persuade  the  factory  to  build  the  special  car,  but,  as 
work  was  still  rushing  and  the  factory  was  running  day  and  night,  they  could 
not  possibly  afford  to  build  this  special  model  at  the  present  time,  but  hoped  in 
the  future  they  would  be  able  to  do  so.  In  the  meantime  they  would  lay  out 
plans  in  accordance  with  our  requirements  and  as  soon  as  they  were  able  to 
build  the  car  they  would  submit  plans  for  our  approval. 

During  the  Spanish- American  War  in  1898  the  sidings  and  often 
the  main  lines  of  the  railroads  leading  to  Tampa,  Fla.,  were  choked 
and  blocked  even  way  back  into  Georgia.  Ammunition,  guns,  and 
even  troops  were  held  up  and  delayed.  Perishable  supplies  were 
rotting  on  the  tracks;  and  with  all  this  the  railroads  insisted  and 
persisted  in  maintaining  and  giving  preference  to  its  local  passenger 
and  freight  service.  This  condition  existed  in  an  aggravated  form 
even  between  Tampa  and  Port  Tampa,  the  port  of  embarkation,  and 
the  Government  either  failed  or  was  helpless  under  the  law  to  compel 
preference  in  service. 

The  act  of  January  31,  1862,  authorized  the  President  (during 
the  rebellion  only)  to  take  possession  of  railroads  and  telegraph 
lines  for  military  purposes. 

Chapter  3591,  act  to  amend  an  act  entitled  "An  act  to  regulate 
commerce,"  approved  February  4,  1887  (United  States  Statutes  at 
Large,  Fifty-ninth  Congress,  1905-1907,  vol.  34,  p.  587,  Pt.  I,  Public 
Laws) ,  provides : 

That  in  time  of  war  or  threatened  war  preference  and  precedence  shall,  upon 
the  demand  of  the  President  of  the  United  States,  be  given,  over  all  other 
traffic,  to  the  transportation  of  troops  and  material  of  war,  and  carriers  shall 
adopt  every  means  within  their  control  to  facilitate  and  expedite  the  military 
traffic :  And  provided,  That  whenever  the  word  "  carrier  "  occurs  in  this  act 
it  shall  be  held  to  mean  "  common  carrier." 

Even  with  this  law  on  the  statute  books,  headquarters  and  one 
battery— Third  Field  Artillery— left  San  Antonio,  Tex.,  under 
emergency  orders  for  El  Paso  to  meet  a  reported  hostile  movement 
in  force  on  that  city  from  Mexico,  and  for  no  apparent  reason  the 
train  was  sidetracked  for  the  regular  traffic  and  arrived  at  destina- 
tion over  12  hours  late  on  the  regular  passenger  schedule. 

5.  RECOMMENDATIONS  FOR  NECESSARY  LEGISLATION. 

In  conclusion  it  may  be  stated  that  three  considerations  and  con- 
ditions appear  especially  important  and  necessary: 

First.  Authority  to  place  an  order. 

Second.  Obligation  to  fill  an  order. 

Third.  Coordination  between  departments  of  the  Government  and 
agencies,  and  regulations  governing  procedure. 

517 


12 

It  is  therefore  recommended  that  the  necessary  steps  be  taken  to 
secure  legislation  to  authorize  the  following  provisions: 

1.  That  the  President  be  empowered,  through  any  head  of  de- 
partment or  bureau  of  the  Government  in  addition  to  the  present 
authorized  methods  of  purchase  or  procurement  in  time  of  war  or 
when  war  is  imminent  or  whenever  in  his  opinion  the  exigencies  of 
the  service  and  the  interest  of  the  Government  demand,  to  place  an 
order  with  any  individual,  firm,  corporation,  company,  or  organized 
manufacturing  industry  for  such  product  or  material  as  may  be  re- 
quired, and  which  is  of  the  nature  and  kind  usually  produced  or 
capable  of  being  produced  by  such  firm  or  company. 

2.  That  compliance  with  all  such  orders  or  demands  for  service 
shall  be  obligatory  on  the  part  of  industries  concerned,  and  shall 
take  precedence  over  all  other  orders  and  contracts  when  in  the 
opinion  of  the  President  the  conditions  warrant. 

3.  That  the  compensation  shall  be  fair  and  just  and  shall  result  in 
a  reasonable  profit  to  the  industry  concerned,  as  shown  by  bill  of 
expenses. 

4.  That  there  shall  be  authorized  and  established  a  board  or  com- 
mission on  mobilization  of  industries  essential   for  military  pre- 
paredness, nonpolitical  in  nature,  and  including  in  its  membership 
representatives  of  the  Government  selected  by  the  President,  and 
skilled  representatives  of  industries,  either  permanent  or  advisory, 
to  be  selected  by  the  industries  concerned,  and  the  necessary  secre- 
taries and  clerical  assistants  whose  duty  it  shall  be  to  organize  and 
coordinate  the  work  to  fully  meet  all  requirements  of  the  Govern- 
ment service. 

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